Monday, June 27, 2011

ADVAN’s Newspaper Circulation Report: Why the Figures Remain Controversial

Here is an article I read a while ago and I thought more people should read this and form thier own opinion. Happy reading...

"Expectedly, the fireworks have continued as newspapers desperately defend their investments, insisting that their sales figures couldn’t be as bad as the Advertisers Association of Nigeria (ADVAN) have made it look, after an independent Reports. The Report which was done over a period of six weeks, between March and April, portrayed an alarming slide in the patronage of newspaper s. According to the study done across the country on about 15 newspapers, the daily sales figure of all the newspaper was less that 300, 000, meaning that only one in every 470 Nigerians buy newspapers daily. That ratio apparently doesn’t consider persons and organizations that buy between 2-10 newspapers daily. By this, it may be more appropriate to say that one in every 500 Nigerians buy newspaper daily.

The angry reaction of the newspapers is understandable as these figures could greatly jeopardize their advert revenue, which constitutes the bulk of their profits. No newspaper in Nigeria can survive only by it circulation revenue, “each of the newspapers will need to sell at least 200 000 units to survive on circulation alone,” Nasir Ramon, a senior corporate communication staff of UBA said. And while they have disputed the ADVAN survey, none of the figures they declare as their circulation figures come anywhere near that of ADVAN. Punch, the highest selling, according to the Report, have previously claimed a figure of between 120 000 to 150 000. Others claim they do between 50 000, 80 0000, and 100 000 copies, and advertisers have since been working based on that.
That is why till date, only The Nation, which surprisingly came second in the ranking, has published the report. Others have declined in apparent protest. Punch’s rating as the number 1 selling national daily merely confirmed the obvious. However, instead of 120 000 or 150 000 copies claimed by Punch, it was said to circulate only 34, 264 copies, which is barely a fifth of what their claim. The Sun was ranked third with 25, 632 unit sales. Vanguard got 25, 241, while Guardian and Thisday, two of the newspapers with the largest advert revenue in Nigeria, came 5th and 6th respectively, with 25, 222 and 21, 703 daily sales.

The assessment also had Daily Trust, the most popular newspaper up North with 11, 672 daily unit sales. Tribune, the oldest surviving newspaper in Nigeria, was another surprise, managing only 8, 314 daily sales. The above mentioned dailies constitute what is known as the top 8 in the standing. The others combined, including Compass, Daily Independent, Leadership, National Life, New Nigeria, Mirror and Westerner, could barely rake up 1,600 daily sales, according to the ADVAN reports.
The decision to do the newspaper circulation Report became imperative due to the absence of an independent Report of newspaper figures in Nigeria. Over the years, actual newspaper sales have been shrouded in secrecy. This vacuum has made it difficult for marketers and advertisers to plan, execute and truly ascertain the level of impact of their marketing and advertising campaigns. According to the Association of Advertising Agencies of Nigeria president, Funmi Onabolu, “We are all accountable and we need the right figures to work with. More collaborations of this sort are needed in the industry for us to come up with research data verifiable fact and figures to run our businesses.”

“Nigeria is the only country in the world where you don’t have an independent data for planning. For the print media all over the world, the Report Bureau of Circulation has always been the bedrock for media planning. The ABC allows you to know what the circulation figure of every newspaper and magazine is,” said Dele Shobowale, Newspaper Columnist and Marketing Research Consultant, who was a key member of the ADVAN Report committee.

This survey is obviously a defining moment in the administration of the new ADVAN president, Idoreyen Enang. He told the press during the public presentation of the Report that the study was necessary to fill a vacuum in advertising planning. “The new figures released are expected to impact campaigns planning positively and also help with appropriate media pricing. This is expected to positively contribute to the productive capacity of all concerned,” Enang remarked.
Enang’s expectation is, however, still far from reality, given the intensity of debate the Report has generated. Two of the newspapers that have categorically rejected the study are Compass and Tribune. Their grouse is that it is not possible to have an authentic survey without consulting the stakeholders in the industry, in this case the newspapers. Compass argued that they were never consulted by ADVAN. They also contended that the Report did not take cognizance of sales by subscription.

That argument is not likely to sway opinion because, according to Chris Doghudje, chairman of Advertising Practitioners’ council of Nigeria and one of the Reportors, the newspapers were to blame for making the study a one sided affair. He blamed them for pulling out of the Report at the final moments, when it was time to sign an agreement, because they didn’t want the public to know their actual sales figures. Sobowale told M2 that Nduka Obaigbena of Thisday never favoured the Report from the outset; he was soon joined by Goddie Ibru of Guardian before others followed, except for the Punch MD who rooted for the Report until the last minute. “To be fair, Ogunsola was not happy about the action of his colleagues; he almost resigned as NPAN president in protest,” Doghudje said.

That was not the first time the print media had frustrated an Report. “Nigeria tried it once in 1976 or thereabout. Only about five newspapers participated. Some of the big ones didn’t,” Doghudje informed. But this time, ADVAN was more determined to go ahead with the counts. So, when the newspapers pulled out, they adopted an alternative, which involved getting the supply and sales records of all the 45 newspaper distribution centres across the nation, where all newspaper and magazine outfits submit their copies for onward distribution to vendors and agents across their states.
With Sobowale in the team, the bureau got enough cooperation from the distribution centres, because he had worked closely with them during his years with Vanguard, where he managed the company’s circulation for many years. “I am the only person who is known to every agent in Nigeria. I have always been with them,” he said. When M2 spoke with him, he showed evidences of all the daily record that were filed in from the distribution centres.

That is why the Reportors have stood by their figure challenging the newspapers that feels aggrieved to counter them by agreeing to the establishment of an ABC like it’s done in other countries. They also waved off the subscription complaint as fallacies because “99 per of newspaper sales are done through agent who keep records,” Doghudje insisted, adding that even the subscribed papers are sent through agents.

The Reportors conceded that it could be difficult to be 100 percent correct using their method, but insisted that they are near perfect and challenged the newspapers to show more transparency and cooperate with ADVAN as they seek to ensure proper figure for their advertising planning.

Sobowale, a sales expert and a key figure in the Report, have been collating newspaper sales figure for years. He first did it as an employee of Vanguard, where he was charged with finding out the company’s market share, and is now working on a book that focuses on newspaper circulation in Nigeria. In trying to defend the authenticity of the Report, he told M2 that he took advantage of the very close working relationship he had with agents across the country while he was in charge of Vanguard’s circulation. “In Nigeria, there are circulation centres in every state.. The only exceptions are Abia which has two, Delta which also has two, and then Lagos which has seven. All the other states have one. People actually monitored each of the centres for the six weeks of the survey,” he said.

Prior to the cover price increase around November last year, total national circulation figure was around 315,000 but as at March, immediately after the increase, the figure fell to just over 270 000. As at the time of the study, The Nation was yet to increase its cover charge like Punch and Vanguard had done, so some of Punch’s customers temporarily switched allegiance to The Nation.” If the studies were carried out now, I’m sure the situation will be different,” Sobowale explained.

And while the newspapers have dismissed the Report, none of them have accepted ADVAN’s challenge to submit to an Report. Some of the newspapers including Vanguard, Champion and even Guardian, are yet to make an official statement. Only Punch came close by promising to open it books to the Reportors on the condition that others agree to do same. Indeed, ADVAN believe that a number of factors are responsible for the poor newspaper sales. Sobowale noted that circulation decline is a global phenomenon as the newspaper industry in America, Europe and even Asia is also affected. This is primarily due to the impact of internet, which guarantees quick news for free. Records showed that several newspapers around the world have shutdown as a result. For instance, 75 provincial newspapers in the UK have closed shop as a result.

Yet Sobowale agreed that it is no justification for the industry not to record up to 300 000 copies daily sales in a country of about 140million population, labelling the situation as pathetic. Topping the list of all the causes is the crashing local economy, which has greatly reduced the purchasing power of most Nigerian. According to the United Nations, Nigeria is one of the poorest nations on earth and about 70 percent of her population lives on less than one dollar per day. Sobowale also noted that the increase in cover charge contributed to the sharp drop in sales. In a chart he showed to M2, between 2003 and now, sales figure has dropped from 570 000 unit per day to less than 300 000 unit, signifying almost 50 percent drop. As it were, the only hope of a rise in circulation income for the newspapers is the coming election. As revealed by the Report, from 1999, elections have always ushered in improved patronage. Therefore, with the 2011 around the corner, newspaper sales could gallop soon.

But still, the figure is not likely to go anywhere near the 200 000 copies needed to sustain a newspaper, without adverts revenue. Sobowale also blamed managerial inefficiency for the problems of the media. He insisted that the cost structure of almost every newspaper in Nigeria does not make sense from the standpoint of managerial economics. The cost is too high. In trying t recover the cost, the cover charges are too high also, he said. He said that if newspapers were tightly managed, the cover price will not be more that N50 and that will result in bigger sales. “For example, many newspapers in this country have printing presses that are designed to print a million or more per day. But no newspaper in Nigeria today prints half a million. So they have installed capacity that is far in excess of their operations. That is inefficient,” he said.
“They put 500 copies of newspaper in a van that can easily accommodate up to 500 000 copies if properly bundled and stacked. The cost of transporting the papers and the wear and tear on the vehicle is more than whatever money they are going to make from the newspapers,” he said.
And, like what was done in the banking industry, he advocated for merger of some of the print media in Nigeria, arguing that Nigeria as a nation does not require more than three newspapers. “Some newspapers are just monumental wastes. Someone should go and close shop,” he declared.

But that may be a real bitter pill for some of the media houses to swallow even if their circulation revenue in a month is barely enough to fuel their publishers’ cars over the same period".

By Joseph Ekeng

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